Passing off, and passing on

It took over 20 years for Winnebago to halt the Binns family's sale of Australian recreational vehicles under the same name. Now the family must rebrand as its business passes to the next generation.

At the same time as passing on their business to the second generation, the Binns family has an extra challenge: rebranding it, having been found guilty of passing off.

For more than 30 years, Bruce Binns and his wife Ruth have been making Winnebago brand motor homes in western Sydney, not far from where Prime Minister Julia Gillard is staying at the moment. But Winnebago of the United States has successfully sued them for "passing off” – that is, for unlawfully using the name.

The Binns family, now including son Ben who is chief executive of the business, and daughter Samantha, head of marketing, is appealing the decision of Federal Court judge Lindsay Foster but in the meantime they have until September to stop using the name.

The appeal will be heard next month but Ben and Samantha, 38 and 40 respectively, are not taking any chances. They have brought in the branding experts and come up with a new name – Avida – and a tagline they can use for six months: "The maker of Australia’s Winnebago”. Will it work? They hope so.

If they can’t make this double transition – generation and brand – Bruce Binns’ legacy will go up in smoke, as it did once before already.

In 1977, Bruce and Ruth’s first motor home business, called Freeway, went bust and was wound up. Bruce was a young builder who, in 1965, started making 'slide-on' motor homes, the ones that sit on a ute. It was a typical bootstraps start-up: he made one in the backyard and put it on the nature strip with 'For Sale' sign on it, then another, and another, and so on.

Pretty soon they had a business and a small factory. In 1973 Samantha was born and then two years later Ben. By 1976 they had expanded rapidly – making caravans, tent trailers, slide-ons and full motorhomes – but they grew too fast, and in 1977 the business failed. It was wound up on October 31, 1977.

Bruce Binns is not the sort of bloke to give up and decided to start again with a new name. In 1978 he learned that Gerry Ryan, the owner of Jayco Caravans (and more recently the man behind 'Walking With Dinosaurs' as well as owner of the Melbourne Cup winner, Americain) owned the business name 'Winnebago' in Australia.

So Bruce paid Gerry $1500 for the name and went back to work, this time making Winnebagos. It worked. Now the Binns family’s Knott Investments makes 500 motor homes a year and is Australia’s largest producer, with 40 per cent market share.

Winnebago of the United States, which also started as a family business, was surprisingly slow to try to stop the Binns from using the name. Its founder, John K Hanson, thought of the name in 1959 while sitting around the kitchen table: Winnebago was the name of the US county in which their town Forest City was located.

Their business listed on the New York Stock Exchange in 1970 and by 1986, Winnebago was included in the Fortune 500 list of America’s largest corporations, with 21 per cent of the US market for recreational vehicles (RVs).

Around about the same time, in 1985, they became aware that an Australian firm was using the same name to make the same product, but they didn’t do anything about it until 1991, when a letter of demand was written to Bruce Binns, demanding that Knott cease using the Winnebago name.

Negotiations then took place, and in 1992 a 'Settlement Agreement' was signed in which the Binns company agreed not to use the name in the United States and Winnebago US agreed not to sue them – in the US.

Bruce then went back to work making Winnebagos, advertising the name and building the business. It was a golden period for the family and the business grew rapidly, as the ageing of the population saw more and more 'grey nomads' take to Australia’s highways.

But in 2010, the boom was lowered. Winnebago US again demanded that the Binns family stop using the name and this time they followed up with a lawsuit in the Federal Court of Australia (they hadn’t promised in 1992 Settlement Agreement not to sue them in Australia).

Mr Justice Foster’s judgement was handed down in July last year, 18 months after the case ended, and it must be said that Bruce doesn’t come out of it too well.

"I do not find Bruce Binns’ earnest denials to the effect that he was not endeavouring to trade off the goodwill and reputation of Winnebago credible. I find that, by choosing to exploit the Winnebago name and the Winnebago logos, he was intending to gain for himself as much benefit as possible in Australia from the goodwill and reputation of Winnebago and its RVs.”

And, even worse: "He intentionally hijacked the Winnebago marks in Australia in a bold attempt to pre-empt Winnebago’s opening its doors here. No doubt Bruce Binns thought that, by taking such action, he could keep Winnebago out of Australia, or, at the very least, hold it to ransom and extort a significant payment from Winnebago. In the meantime he and Knott would be able to trade off its reputation.”

Needless to say, with remarks like that from the bench, Bruce lost the case, along with the 11 dealers, who were also named in the lawsuit.

Ben Binns, who runs the company these days, says they were all shocked by the decision and are appealing to the Full Bench of Federal Court. But in the meantime, they are acting on the ruling, just in case.

All of their products are now branded 'Avida' and last week they launched the brand at the Adelaide Caravan Show, and sold 10 units. There are 25 caravan shows around the country, and Ben and Samantha Binns will be at all of them with their Avida motor homes.

Just as it was in 1978, the Binns family’s collective back is to the wall again.

But the truth is, they have had a good ride with the Winnebago name. For 30 years Winnebagos have been appearing in movies and TV shows from America, and the only place to get them in Australia was from a factory at Emu Plains owned by the Binns family, no relation to Winnebago US.

Now that ride looks to be over, and a new one begins for the next generation.

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